Correlation Between Jefferies Financial and Energisa
Can any of the company-specific risk be diversified away by investing in both Jefferies Financial and Energisa at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Jefferies Financial and Energisa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jefferies Financial Group and Energisa SA, you can compare the effects of market volatilities on Jefferies Financial and Energisa and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Jefferies Financial with a short position of Energisa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jefferies Financial and Energisa.
Diversification Opportunities for Jefferies Financial and Energisa
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Jefferies and Energisa is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Jefferies Financial Group and Energisa SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energisa SA and Jefferies Financial is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Jefferies Financial Group are associated (or correlated) with Energisa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energisa SA has no effect on the direction of Jefferies Financial i.e., Jefferies Financial and Energisa go up and down completely randomly.
Pair Corralation between Jefferies Financial and Energisa
Assuming the 90 days trading horizon Jefferies Financial Group is expected to generate 0.74 times more return on investment than Energisa. However, Jefferies Financial Group is 1.36 times less risky than Energisa. It trades about 0.03 of its potential returns per unit of risk. Energisa SA is currently generating about -0.1 per unit of risk. If you would invest 47,619 in Jefferies Financial Group on October 11, 2024 and sell it today you would earn a total of 339.00 from holding Jefferies Financial Group or generate 0.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jefferies Financial Group vs. Energisa SA
Performance |
| Timeline |
| Jefferies Financial |
| Energisa SA |
Jefferies Financial and Energisa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jefferies Financial and Energisa
The main advantage of trading using opposite Jefferies Financial and Energisa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jefferies Financial position performs unexpectedly, Energisa can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Energisa will offset losses from the drop in Energisa's long position.| Jefferies Financial vs. Energisa SA | Jefferies Financial vs. BTG Pactual Logstica | Jefferies Financial vs. Plano Plano Desenvolvimento | Jefferies Financial vs. Ares Management |
| Energisa vs. Equatorial Energia SA | Energisa vs. CPFL Energia SA | Energisa vs. Eneva SA | Energisa vs. Companhia de Saneamento |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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